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Monday, 9 December 2002
Page: 9939

Dr WASHER (9:27 PM) —May I congratulate the member for Braddon for supporting this bill and also for the effort that Tasmania, as a state, has put into renewable energy. The Renewable Energy (Electricity) Amendment Bill 2002 amends the Renewable Energy (Electricity) Act 2000 to clarify key definitions in the original legislation and to provide for greater efficiency and effectiveness in the administration of the legislation. These clarifications are needed to maintain the integrity of the legislation and to ensure the full achievements of its objectives.

The Renewable Energy (Electricity) Act 2000 was a world-leading piece of legislation which a number of countries have identified as a model for promoting renewable energy through a market based trading system. Although this legislation has been in operation only since April last year, its implementation is already achieving and delivering significant benefits. Small and large producers are included in the trading scheme, and there are strong indications of investor confidence in the renewable energy sector, with many projects proposed for development. The clarification of definitions contained within the act is particularly important from the viewpoint of investors in renewable energy. The amendments will provide greater clarity about what is an eligible renewable energy source, what is an accredited power station and what is a relevant acquisition of electricity.

The harnessing of renewable energies is a challenge that we must continue to address to fulfil our commitment under the Kyoto protocol. Electricity generates more than 70 per cent of Australia's greenhouse gas emissions, and coal-fired power is responsible for 90 per cent of those emissions. Under the government's current mandatory renewable energy target, MRET, an additional 9,500-gigawatt hours of electricity per year must be generated from renewable sources by 2010, resulting in annual greenhouse gas emission reductions of around seven million tonnes.

There are a number of exciting and innovative projects in Australia at the moment which have great potential to reduce our greenhouse gas emissions significantly in the years ahead. One of the more notable and ambitious projects is planned for inland New South Wales, and construction is expected to begin next year. It is a revolutionary clean energy solar power station whose centrepiece is a massive concrete and steel tower that will rise one kilometre into the air. It will be the biggest man-made structure on earth—more than double the height of the world's tallest buildings. A large glass `sunlight collector' or greenhouse, seven kilometres in diameter at the base of the solar tower, will create an updraught of hot air powerful enough to spin the turbines in the base. The solar power station, comprising the greenhouse and tower, has the capacity to generate 200 megawatts of electricity—enough to supply 200,000 households. It is interesting that it is effectively a gigantic greenhouse that will help reduce our greenhouse gas emissions.

The capital outlay for these sorts of projects is substantial, but their life spans are considerable and they start becoming seriously economical 15 or 20 years down the track. In terms of the environment and the reduction of greenhouse gas emissions, they start saving us from day one. And of course projects such as this have started looking more viable since the introduction of the Renewable Energy (Electricity) Act 2000, which introduced a kind of subsidy for electricity generated from renewable sources in the form of renewable energy certificates. This solar tower project confirms Australia as a world leader in renewable energy production aimed at reducing greenhouse gas emissions. The company planning this massive venture, EnviroMission, has already identified potential sites for further solar towers, including one in my own state of Western Australia.

Another bold and innovative project in the search for renewable energy sources is the exploration of the hot- dry-rock geology lying buried beneath several kilometres of insulating earth in South Australia. The Cooper Basin has the hottest known rocks in the world, at drilling depths that are economically viable. Scientists believe these naturally radioactive rocks beneath the earth's surface could provide an inexhaustible and environmentally friendly power source for many years to come. A series of geothermal power stations fuelled by subterranean radioactive rocks has the potential to meet the total electricity demand of the country for hundreds of years, according to scientists. Such a project would be massive—on a scale similar to the Snowy Mountains scheme or the North West Shelf. But despite the scale, the concept itself is simple. The earth's reserves of heat in naturally radioactive rocks could provide an effectively inexhaustible and renewable source of power: no greenhouse gas emissions, little water usage and minimal pollution. Put simply, water is pumped into the hot zone approximately three kilometres beneath the earth's surface, where it spreads through a `reservoir' of hot, cracked rocks. It heats up and returns to the earth's surface as steam, to spin turbines and generate electricity. The water is then recaptured and reused.

Geodynamics Ltd are focusing on South Australia's Cooper Basin, where the geology is not only highly promising but well researched, thanks to years of exploration and drilling for oil and gas. Whilst time and money are two major stumbling blocks in the path of hot rock technology, it is a serious contender for future energy needs. A geothermal station would require about 25 years to become operational and would be enormously expensive to build. However, once up and running it should pay for itself within a few years, with minimal maintenance and running costs.

Australia has huge potential to develop clean renewable energy. We have huge areas of flat plains and deserts, vast basins of volcanic rock underground, huge tides along the northern coast of Western Australia with great opportunities to harness tidal power, as the member for Kalgoorlie would surely tell us, and a vast coastline ideal for the siting of wind generated turbines and wave power energy generation. There is to be a wave power plant established at Two Rocks, north of my electorate, in the near future. Just a few weeks ago the Minister for the Environment and Heritage, Dr David Kemp, announced Commonwealth funding of $5 million from the Renewable Remote Power Generation Program for the new Esperance wind farm in the south-east of my state of Western Australia. The government has also recently given the green light to Pacific Hydro's 120 wind generators at four sites in Victoria. These are all significant measures towards the goal of reducing our greenhouse gas emissions and meeting our Kyoto commitments.

The Renewable Energy (Electricity) Amendment Bill 2002, with its suite of administrative changes, is being introduced now to ensure that there is as little delay as possible in providing certainty to both the power generation industry and the renewable energy industry in the operation of the renewable energy trading system. This certainty is essential for them to make the types of strategic investments required to achieve our challenging target of an additional 9,500-gigawatt hours of electricity based on renewable energy.

The administrative amendments contained in the bill are designed to ensure that the integrity of the original legislation is maintained and that it achieves its full objectives. As well as clarifying the definitions in the act, this bill also gives the Renewable Energy Regulator the capacity to vary decisions, including those related to energy acquisition statements, energy shortfall statements and the 1997 eligible renewable energy baseline for an accredited power station. This capacity to amend decisions meets a pragmatic need of the regulator to address mistakes made by participants or to respond to changing circumstances, additional information or the results of monitoring and compliance actions.

The bill provides for the introduction of information-gathering powers to underpin the monitoring, auditing and compliance requirements of the act. This bill also recognises that the administrative load for the Office of the Renewable Energy Regulator will greatly increase. In order to meet this demand, provision will be made to allow the appointment of Commonwealth officers or employees of state and territory governments to operate as authorised officers and to exercise the power to monitor compliance with the act.

The amendments also give the regulator the capacity to suspend entitlements, including the accreditation of a power station in a number of limited circumstances. This is particularly important to ensure that the owners and operators of these businesses conduct themselves in a manner in keeping with the objectives of the legislation. If a power station contravenes or is suspected of contravening a law of the Commonwealth, a state or a territory, its accreditation can be suspended. Likewise, if the regulator is reasonably of the opinion that generators are manipulating the output by increasing the quantity of renewable energy certificates able to be created without increasing renewable energy generation, their accreditation can be suspended. The Renewable Energy (Electricity) Amendment Bill 2002 safeguards the integrity of the world-leading and bold legislation contained in the Renewable Energy (Electricity) Act 2000. This country already has many innovative sources of renewable energy and it is worth noting that Tasmania, our smallest state, currently generates more than half of this nation's renewable energy. But, as I have said, there are more innovative and exciting projects under way. These amendments will improve the efficiency and effectiveness of the operation of the act and promote investment in further projects through greater clarity and certainty. I commend this bill to the House.